by Amiti Sen, Hindu Businessline
Sept. 1, 2014 (TSR) – India will try to convince China to back its stand on securing an agreement on food security at the World Trade Organisation simultaneously with a trade facilitation pact, when talks resume this month.
Commerce Minister Nirmala Sitharaman is likely to do so when she meets her Chinese counterpart Gao Hucheng after the Joint Economic Group in that country on Tuesday.
New Delhi has refused to back an agreement on trade facilitation, strongly pushed by developed nations, including the US and the EU, till measures are taken to legitimise its subsidies for food procurement.
India will also seek further Chinese investments. It will ask China’s state health body to source generics from the country and press for tariff reduction on carpets and diamonds at the Joint Economic Group meeting.
Widening trade gap
With India’s trade deficit with China widening to $36 billion in 2013-14 – which is more than a fourth of the country’s total trade deficit – Sitharaman will press for Beijing to take some positive action towards checking it.
“China has been making the right noises on its intention to help India close its trade gap, but has done little so far. The trade deficit can be bridged only if China agrees to buy more from India and invests more in the country,” a Commerce Ministry official told BusinessLine.
Consumer products, railway wagons, high speed trains, industrial corridors and certain categories of telecom equipment are some of the areas that India would want China to focus on as areas for potential investments, the official said.
Sitharaman is expected to convince China that investors would find the going smooth in India and the hiccups suffered by present investors such as telecom company Huawei and construction company Longjian Road would be avoided.
China has an estimated $1.1 billion investment in India so far, but it could go up several folds as it has foreign exchange reserves of over $3.8 trillion.
Pharmaceuticals is another area that India will focus on as Indian producers have not been able to participate in the bidding for generics carried out by China’s state undertaking on health.
“We have taken up the matter with the Chinese authorities and have urged them to explain to the Indian producers the required procedures and processes to participate in bids. It is a big market we can tap,” the official said.
India will also press for lower tariffs on carpets and diamonds so that more could be exported from the country. It will ask Beijing to honour its promise of lifting the ban on buffalo meat from India, which could earn more than $1 billion in export earnings.